Why it is never good to take on more loans just because they are available ...
But sometimes, circumstances beyond your control will cause you grief ...Although speculators drove prices upward in many instances, conventional homeowners took advantage of the rise in property values by taking on home-equity loans that increased their debt -- often to amounts greater than they had paid for their houses.Now, with prices falling, those who want or need to move often face a dilemma: Should they lower their price below what they owe on their property and pay the mortgage balance from their savings? Or should they stay put, paying down mortgages and waiting for the market to rebound?
Mike Larson, a real-estate analyst with Weiss Research in Jupiter, said those who must move might no longer have a choice."If you bought in many Florida markets in 2004, 2005 or 2006, it is very likely that you just won't get your money back," Larson said. "You see this same thing when people have to sell stock for less than they paid for it, but housing is different."People have a lot tied up in their houses, and they don't like to think about losing money on them."Larson said sellers need to face the reality of the current market and think creatively.
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